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Stocks pulled back as investors watch the Federal Reserve’s FOMC policy meeting.
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Interest rates are expected to stay unchanged, but the Fed could indicate more hawkishness.
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AI stocks fell, even after Nvidia’s GTC Conference sent them higher on Monday.
Stocks traded mostly lower Tuesday as investors turned their attention away from artificial intelligence updates to focus on the Federal Reserve’s latest policy meeting.
The Fed kicks off its two-day meeting of the Federal Open Market Committee today. Though interest rates are broadly expected to remain unchanged at 5.25%-5.50%, recent inflation reports have been coming in higher than anticipated and could prompt the central bank to remain hawkish in its outlook.
“Investors are likely to sit on their hands now during the two-day Fed meeting which ends tomorrow,” David Morrison, senior market analyst at Trade Nation, said.
He added: “The concern is that, following last week’s disappointing inflation releases, the Fed may indicate that it is pushing out further the timing of its first rate cut since March 2020. This could also see it revise downward its projections for how many cuts we may see this year.”
Meanwhile, Monday’s enthusiasm for artificial intelligence equities proved short-lived, as shares in stocks such as Super Micro Computer and Nvidia declined Tuesday morning. Nvidia’s pullback followed on its GTC Conference, where the company showed off new tech, including its latest AI chip.
Here’s where US indexes stood shortly after the 9:30 a.m. opening bell on Tuesday:
Here’s what else happened today:
In commodities, bonds, and crypto:
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West Texas Intermediate crude oil slipped 0.11% to $82.63 a barrel. Brent crude, the international benchmark, climbed by 0.05% to $86.9 a barrel.
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Gold declined by 0.22% to $2,156.65 per ounce.
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The 10-year Treasury yield fell two basis points to 4.318%.
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Bitcoin fell by 6.5% to $63,354.
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